Subject: Re: Goog vs Msft
Shouldn't Alphabet be trading at a similar multiple to MSFT?
20 vs 38!

From the opposing viewpoint, shouldn't Microsoft be trading at a similar multiple to Alphabet?
: )


As for the reason for the gap, a lot of people think Google's keyword search profits will fall a lot, and that's probably a little over half their profit. The less panicky among those people merely think that the LLM answers they provide instead will be very expensive to provide.

It would not be a big surprise to see Apple start defaulting to a different search method (somebody's LLM), and cut their payments to Google for default search placement. That would have a lot of repercussions: one time jump up for Alphabet profits followed by much slower growth? Lower search market share overall even? If one liked Alphabet for a trade, maybe a nice time to sell would be the price spike in the months after the earnings spike...

Jim